Thanks for your detailed and courteous reply, this is greatly appreciated in times when people tend to be at each other throats in forums

It's great that you described what you think is the process of phone payment. From what I read in Apple's website the process is simpler than what you describe.
* Take iPhone
* Move it close to credit card reader
* place finger on Touch ID fingerprint sensor
* No need for PIN, or unlock, just wait for confirmation beep and vibration.
* Done!
This is obviously if you pay with a default card (which is my case). If you have to choose another card, then I guess the steps that you describe would have to be done and the convenience goes down quickly from there if you need to involve Passbook

Still great if for some reason you forgot your wallet at home

For me the greatest convenience is if I can pay with my default card, without having to unlock or turn on the screen, just get the phone close to the reader and use Touch ID.